Advanced Financial Accounting (AFA) : Assignment

Running head: ADVANCED FINANCIAL ACCOUNTING
Advanced Financial Accounting
Name of the Student:
Name of the University:
Author Note

ADVANCED FINANCIAL ACCOUNTING1
Table of Contents
Answer to Part A.............................................................................................................................2
Answer to Part B..............................................................................................................................3
Answer to Part c...............................................................................................................................5
Answer to Part D.............................................................................................................................6
References........................................................................................................................................7

ADVANCED FINANCIAL ACCOUNTING2
Answer to Part A
The issue that has been presented in the question refers to the fact that the adoption of the
International Financial reporting Standards by the listed entities have led to the enjoying of the
certain benefits that have resulted in the improvement of the quality of the financial report. This
means that the accounting standards had been established for the purpose of establishing the fact
that the corporate entities have prepared the accounting statements for the ease of the third party
investors and the other stakeholders of business. The improvement of the quality of the
accounting statements and the providence of a clarified image or information in regards to the
particular business has helped the stakeholders in taking the potential economic decisions.
However, there have been certain opinions in regards to the fact that the implications of adopting
the International Financial Reporting Standards have been negative in nature. This means that the
experts have been of the opinion that the financial report that has been prepared in accordance to
the reporting standards established by the International Financial Reporting Standards, has
resulted in the requirement of huge amounts of money especially in the preparation of the reports
accounting statements per the norms established by the accounting regulatory body. Moreover,
the preparers of the financial reports have also been of the opinion that the adoption of the
International Financial Reporting Standards have also resulted in the unnecessary disclosures in
the annual report of the corporate entity. This has lengthened the volume of the report and
increased the complexity of the financial information that has been reflected in it.
The qualitative characteristics of the financial report that can be attributed in order to
comply with the International Financial Reporting Standards are the qualitative characteristics of
relevance, understandability, timeliness and faithful representation. It must be noted here that
these are the reporting standards that have been further exploited or have resulted in the ruining
of the quality of the financial report. This can be evidenced from the fact that the qualitative
characteristics of faithful representation has reflected the overload of the disclosures in the
annual report of the corporate entity. This has increased the complexity of the accounting
statements and has resulted in the difficulty of the third party investors or the stakeholders of
business in interpreting the financial information from the annual report. The qualitative
characteristic of relevance has also resulted in the increase of the chances materiality or
misstatement in the books of accounts. Therefore, relevance is another qualitative characteristic